Forex News
May 23, 2013 @ 7:59 am

Aussie plummets to lowest since October 2011

The Australian dollar dropped to 19-month lows against the US dollar on Thursday, after weak manufacturing data from China fuelled concerns over the outlook for global economic growth.

China is a major export market for Australia and so the disappointing data has a large impact on the Australian currency.
AUDUSD extended its decline following the Chinese data during the Asian session and through to the European session, reaching as low as $0.9592, the lowest since October 2011.

China’s HSBC manufacturing purchasing managers’ index slipped to 49.6 in May, below the 50 level that separates contraction from growth down from a final reading of 50.4 in April.

Meanwhile, the US dollar is firmer today, as a result of US Federal Reserve Chairman Ben Bernanke’s comments at his testimony on Wednesday.

The Fed chief said that a decision to slow down the pace of the Fed’s asset purchase program could be taken in the “next few meetings” depending on economic data.

These stimulus measures have weakened the dollar substantially since implementation, so any scaling back of quantitative easing will help the dollar strengthen.

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